Why China Ended its One-Child Policy

This video is sponsored by Dashlane. Conveniently store your passwords and get
10% off premium when you sign up with the link in the description. China is huge. The kind of huge that’s hard to wrap your
head around. Beginning in the 1950’s, its population
exploded, from an already respectable 500 million to almost three times that today. which makes it bigger than all of North America,
Australia, and Europe combined. Its consistent economic growth has made it
one of the world’s great powers, with enough military might to claim the strategically
important South China Sea, and enough influence to begin the most ambitious
infrastructure project in history. A $1 trillion dollar network of ports, pipelines,
and railroads across 65 countries. But none of this was inevitable. While China rapidly and forcefully industrialized,
it faced massive famine and housing shortages. Its economy needed time to develop, and the
world deeply feared overpopulation. China’s response was the famous One Child
Policy, which limited ethnic Chinese families to a single child, with a few exceptions. To enforce the law, women were forcefully
sterilized and fined for having too many children. The problem is: it worked. Or, something did. Historians doubt it prevented all 400 million
births claimed by the government, But China’s Total Fertility Rate, the average number of
children a woman will have in her lifetime, has fallen all the way to 1.6, well below the 2.1 needed to maintain its
size. There simply aren’t enough children, and
in a few short years, China will begin to shrink. The One Child Policy was repealed in 2015,
but it won’t make a significant difference, because it only ever sped-up the unavoidable:
As nations develop, they choose to have drastically fewer children. China’s problem isn’t unique, about half
the world lives in a country that is or soon will be in the same position, but it is uniquely
big, and the timing, uniquely bad. The story of China in the 21st century is
just as much about demographics as it is GDP, military power, the rule of Xi Jinping, all
of which will be seriously tested by the coming demographic crisis. To understand why it’s such a threat, and
whether something can be done, we need to look a little more closely. As individuals, humans are unpredictable. We don’t know what someone will do, or say,
or buy, because they don’t know. Impulse guides your decision to add guacamole
just as it does what college you attend. But, countries don’t care about individuals,
they care about groups. And the beauty of demography is that groups
are predictable. Very. Of course, nothing is certain, theories compete
and estimates vary, but it’s much easier to guess how many 18-years-olds we’ll have
in 30 years and in general, what they’ll be doing than, say, the next three decades
of foreign policy or culture. No country has yet figured out how to manufacture
18 year olds, not even China, and that means population today is a good peek at population
tomorrow. When this information is combined with geopolitics
or economics, it goes from mildly interesting to downright powerful. Here’s what we know about China: Each of these lines is one of its age groups,
with babies at the bottom, and elderly at the top. First, are consumers. From 18 to 45, we know people are spending
– they’re going to school, taking out loans, saving… not so much. and despite what this group says about millennials,
they’re very important, because consumer spending is one of the biggest contributors
to economic growth. Next, are the money makers. These people have paid off their debt, now
they’re saving for retirement. And even though they’re a smaller share
of the population, they generate most of its income. In the U.S., for example, they alone pay half
of all income tax. That makes them, a government’s best friend. Finally, at age 65, people are done working,
done saving, and, largely, done spending. What’s special about this group, is how
quickly and how dramatically it begins: In a single day, a retiree often goes from
contributing the highest taxes of their lifetime, to almost nothing, as they slowly collect
pensions and social security. For right now, let’s ignore the total number
of people. China could be bigger like this, or smaller
like this, What’s important is the balance between
these different groups, and that’s why this graphic is so useful. It’s called a Population Pyramid, because,
for most of history, it has been. A constant stream of babies at the bottom,
and a small number of deaths with each subsequent year. A good example is Niger, where the average
woman has 6.5 children. Mortality is very high, making the average
age only 15. But much of the world no longer looks like
a pyramid. In China, it’s turning upside down. As you can see, there are two big bulges in
its population, here and here. The first is currently in its peak spending
years. The second, right in the prime of its high-earning,
high-tax-contributing years. It’s no wonder China is seeing massive economic
growth. But that’s what makes a demographic crisis
such an ugly one: it happens verrryyyy slowly, and then, all at once. Remember, this huge groups of workers will
soon, and quite suddenly retire, as they start waiting for the checks to arrive. But the group responsible for writing those
checks, or at least, funding them, is getting smaller and smaller. The problem isn’t just financial, A single
child must now care for two parents and four grandparents. The United Nations expects China’s Dependency
Ratio, the number of non-working compared to working-age people, to increase at roughly
the same rate as Japan’s, whose population began shrinking in 2011, and now sells more
adult diapers than infant ones. By 2050, China may have more retirees than
all of Germany, Japan, France, and Britain. Worse, the One Child Policy, combined with
a cultural preference for males, has created a massive gender imbalance. As a result, it’s likely that by 2030, one-fourth
of Chinese men in their late 30’s will have never married. At a minimum, an abundance of forgotten young
men will cause some social anxiety. Or possibly, as some experts suggest, serious
conflict. It sounds a lot like the plot of a movie. Perhaps, “No Country for Young Men” Of course, China is aware of the problem,
But it’s fighting an inevitable demographic transition. In the beginning, For China, the early 20th
century, children are abundant. Because: you can only expect a few to survive,
you don’t have the education or tools for family planning, and because the best way
to grow tomatoes is to first grow children. Seriously. For any sleep-deprived parents watching, this
will be a shock, but giving birth was once the ultimate productivity hack. Before there were tractors, there were children. And then, people stop dying. It really only takes a few improvements to
healthcare for rapid reductions in mortality. And that’s how the world grew from 1.6 to
6.1 billion people in one century, That short window where fewer people are dying,
but everyone’s still having children. But it is just a window, after mortality drops,
fertility is right behind it. As industrialization brings rural workers
to find jobs in the city, Children become less a utility and more a liability – the
kind that screams, and cries, and generates student loan debt. As the saying goes: the best contraceptive
is economic development. The fact that countries like China, the U.S.,
Italy, and Germany, have this problem, is an otherwise good sign. Dangerously low fertility is actually a side-effect
of many good things: increased education, opportunities for women, and healthcare. It’s a no-kidding first-world problem. There are many ways to offset the damage,
you can increase productivity, taxes, immigration and/or fertility, But it’s hard to find a solution that doesn’t
come with its own set of problems. Many countries, for example, now offer incentives
for having children. One of the most generous is Sweden, where
couples have the right to 480 days of paid maternity leave PER child. The downside? Employers are more hesitant to hire young
women, who are far more likely to take those days off. And it doesn’t help that, even adjusted
for inflation, the cost of raising a child has risen for decades. Babies just can’t compete with dogs. China has already gone from issuing fines
for second children to issuing checks, but people just don’t seem to want them. This paper predicts the new two-child policy
will only increase China’s population from 1.4 to 1.45 billion in 2029. Because a person’s ideal family size is
largely determined by their own, two generations of Chinese now see one child as the norm. Plus, young people are pressured to work longer
and harder to keep up with the rising taxes needed to support the older population. None of this means China can’t come up with
a solution, In fact, it has a few things going for it: As people move to the city, they’ll become
bigger contributors to the economy, And today’s young workers are far better
educated than those they’re replacing – 11 years of schooling compared to just 6. There’s also the bigger trend towards an
automation-based economy which doesn’t rely on a such a large number of workers. But that too, has the potential for chaos. And even if it does manage to increase fertility,
remember that demographic changes are slow. Children born today won’t start contributing
for at least 18 years. Whatever the outcome, it’ll define China’s
role in the 21st century. The One-Child Policy will test China’s national
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